San José Mine

ABOUT SAN JOSÉ MINE

Located in Santa Cruz, Argentina

The San José mine (owned 49% McEwen Mining and 51% Hochschild Mining) is an underground operation located approximately 20 km north of Goldcorp’s Cerro Negro project, in the northwest corner of the Deseado Massif region of Santa Cruz Province, Argentina.

2018 Production

96.6K

Au Oz

6.2M

Ag Oz

2018 Production

47.3k

Au Oz

3M

Ag Oz

Exploration Potential

Great Address

High Grade

Narrow Vein

San José Key Operational FACTS

LocationSanta Cruz Province, Argentina

Workforce1,400 (including contractors)

Mining TypeUnderground

Processing MethodGrinding and floatation

Crushing/Processing Capacity1,650 tonnes per day

2018 Production (100%)96.6 thousand gold oz and 6.2 million silver oz

Production

The San José Mine is held in partnership between McEwen Mining (49% ownership) and Hochschild Mining (51% ownership). The mine has been in production since 2007 and, according to an estimate from December 31, 2017, production will continue into 2024. The life of the mine continues to be updated as exploration advances and the mine's reserves are renewed.

McEwen Mining's guidance for 2018 production at San José was for 48,000 gold ounces and 3,225,000 silver ounces, for a total of 91,000 gold equivalent ounces (based on a 75:1 gold-to-silver ratio), at costs per ounce of gold equivalent of $860 for cash costs and $1,110 for all-in-sustaining costs.

Our 2018 production from San José was of 47,331 gold ounces and 3,020,696 silver ounces, for a total of 87,607 gold equivalent ounces (using a 75:1 gold-to-silver ratio). For the nine months ending September 30, 2018, costs per ounce of gold equivalent were $864 for cash costs and $1,078 for all-in-sustaining costs. Below are presented annual production numbers, costs and sales over the most recent three years.

San Jose (100%)

Full Year
2017

Full Year
2016

Full Year
2015

Ore processed (thousand tonnes)

533

536

532

Average grade gold (gpt)

6.7

6.3

6.4

Average grade silver (gpt)

436

444

448

Average gold recovery (%)

87.4

87.8

88.8

Average silver recovery (%)

86.3

87.4

87.5

Gold produced (thousand oz)

100.5

95.0

96.6

Silver produced (thousand oz)

6,448

6,691

6,706

Gold sold (thousand oz)

99.6

99.8

88.8

Silver sold (thousand oz)

6,501

7,081

6,340

Co-product total cash cost Au (US$/oz)

847

751

871

Co-product total cash cost Ag (US$/oz)

11.07

10.24

11.45

Gold equivalent total cash cost (US$/oz)

839

760

865

Co-product all-in sustaining cash cost Au (US$/oz)

1,058

944

1,119

Co-product all-in sustaining cash cost Ag (US$/oz)

13.83

12.87

14.72

Gold equivalent all-in sustaining cash cost (US$/oz)

1,027

954

1,111

McEwen Mining (49%)

Full Year
2017

Full Year
2016

Full Year
2015

Ore processed (thousand tonnes)

261

263

261

Average grade gold (gpt)

6.7

6.3

6.4

Average grade silver (gpt)

436

444

448

Average gold recovery (%)

87.4

87.8

88.8

Average silver recovery (%)

86.3

87.4

87.5

Gold produced (thousand oz)

49.2

46.6

47.3

Silver produced (thousand oz)

3,160

3,279

3,286

Gold sold (thousand oz)

48.8

48.9

43.5

Silver sold (thousand oz)

3,185

3,470

3,107

Co-product total cash cost Au (US$/oz)

847

751

871

Co-product total cash cost Ag (US$/oz)

11.07

10.24

11.45

Gold equivalent total cash cost (US$/oz)

839

760

865

Co-product all-in sustaining cash cost Au (US$/oz)

1,058

944

1,119

Co-product all-in sustaining cash cost Ag (US$/oz)

13.83

12.87

14.72

Gold equivalent all-in sustaining cash cost (US$/oz)

1,027

954

1,111

RESOURCES& RESERVES

Silver

MEASURED & INDICATED

52,300,000OZ

INFERRED

10,100,000OZ

PROVEN & PROBABLE

20,700,000OZ

RESOURCES& RESERVES

Gold

MEASURED & INDICATED

785,000OZ

INFERRED

188,000OZ

PROVEN & PROBABLE

313,000OZ

RESOURCES& RESERVES

Silver

MEASURED & INDICATED

25,627,000OZ

INFERRED

4,949,000OZ

PROVEN & PROBABLE

10,143,000OZ

RESOURCES& RESERVES

Gold

MEASURED & INDICATED

384,650OZ

INFERRED

92,120OZ

PROVEN & PROBABLE

153,370OZ

EXPLORATION - NEW HIGH GRADE RESULTS

The San Jose Property Has Not Been Fully Explored

The Property Encompasses

469,000ACRES

The San José Property is located in the northwest corner of the Deseado Massif in the Santa Cruz Province in Argentina, where Jurassic bimodal volcanics host numerous gold- and silver-bearing quartz veins. Low sulphidation silver-gold and polymetallic mineralization accompanied Jurassic magmatism and deformation in the Deseado Massif.

The property consists of 98 mining concessions and 10 exploration rights covering approximately 469,000 acres. The sizable land package provides good potential for additional resource and reserve expansion.

The Bajo Pobre Formation is the main host for gold and silver mineralization, where veins are typically developed in competent andesite flows at the Huevos Verdes, Frea and Kospi deposits on the San José property and to a lesser extent in volcaniclastic units.

The San José deposits are considered to be typical low sulphidation silver-gold epithermal vein deposits. The main structural trend of fault and vein systems on the property is northwest to north-northwest, together with less prominent east striking and north to northeast striking faults and veins.